Hinduja Foundries Ltd has decided not to go ahead with an acquisition that the company was considering.

The company's Managing Director, Mr B. Swaminathan, had said a few weeks ago that Hinduja Foundries was closing in on an acquisition in Western Europe.

High price

But on Friday Mr Swaminathan told Business Line that the idea was given up, primarily because of the high asking price, but also because the company would need to put money and attention on catering to the growing domestic demand.

“Typically, companies look at overseas acquisition for market, technology or capacity,” Mr Swaminathan noted. “We believe we have been addressing all these comprehensively and are on the road to achieving all the three through organic growth.”

Orders on hand

Hinduja Foundries has orders on hand for 140,000 tonnes and reckons the company would be able to supply 120,000 tonnes, compared with 72,790 tonnes in 2010-11. Turnover is expected to nearly double to Rs 1,000 crore, from Rs 550 crore last year.

While the company has given up the overseas acquisition move, it actively looks for export opportunities, Mr Swaminathan said. A marquee customer the company has bagged is Renault, France. The order is worth Rs 200 crore.

The company has also secured an order from a UK-based backhoe loader manufacturing company.

Rights issue

Mr V. Sankar, Chief Financial Officer, Hinduja Foundries, said that the company would begin work on the proposed rights issue soon after the company's annual general meeting is over (on July 20). The company intends to raise Rs 125 crore.

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